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An economy does not have a “budget” and I hate hearing this comparison. The banks have the ability to print and redefine the meaning of money, therefore whateve

An economy does not have a “budget” and I hate hearing this comparison. The banks have the ability to print and redefine the meaning of money, therefore whatever you think the budget should or should not be is irrelevant.

inglor_cz 2y ago
It is meant as a metaphor for "a country with a developed economy". "whatever you think the budget should or should not be is irrelevant." Wow, that is an aggressive formulation. Most Western central banks are independent of their governments and don't routinely go on money-printing sprees. Given that with a larger debt, an ever rising portion of the budget goes towards interest payments, I certainly feel that the public debt is relevant for me. Money spent on interest cannot be spent on public goods which I and others would like to use.
AnimalMuppet 2y ago
All right, forget about a budget. In fact, even forget about money. Money isn't all that real; the real economy is about stuff. The economy has a maximum capacity for a given set of workers, resources, and technology. The basic economic question is, which stuff is going to be produced, and where is it going to go? Who's going to get it, and what are they going to do with it? In a market economy, we use money to organize and manage that. But if we print more money, that doesn't create any more stuff at all. If the government is printing more money, two things are happening: The government is buying more of the stuff that's being produced, and the price of stuff is going up (because there's more money chasing the same amount of stuff). That means that everybody who's not the government is getting less of the stuff. Now, that can be fine, if the government is doing things with the stuff that are going to pay society back down the road. If not, though, the government is just using up more stuff, leaving everybody else with less stuff, and causing inflation into the bargain. So the question is: What made up that debt of 100% of GDP? Was it good investments that are going to pay the UK back? Or was it just waste?
s1artibartfast 2y ago
What do you think a "budget" is? It is simply a spending plan developed by humans. Of course they exist. There can be real world consequences for having a bad budget. What exactly are you trying to say?

inglor_cz 2y ago

It is meant as a metaphor for "a country with a developed economy". "whatever you think the budget should or should not be is irrelevant." Wow, that is an aggressive formulation. Most Western central banks are independent of their governments and don't routinely go on money-printing sprees. Given that with a larger debt, an ever rising portion of the budget goes towards interest payments, I certainly feel that the public debt is relevant for me. Money spent on interest cannot be spent on public goods which I and others would like to use.

AnimalMuppet 2y ago

All right, forget about a budget. In fact, even forget about money. Money isn't all that real; the real economy is about stuff. The economy has a maximum capacity for a given set of workers, resources, and technology. The basic economic question is, which stuff is going to be produced, and where is it going to go? Who's going to get it, and what are they going to do with it? In a market economy, we use money to organize and manage that. But if we print more money, that doesn't create any more stuff at all. If the government is printing more money, two things are happening: The government is buying more of the stuff that's being produced, and the price of stuff is going up (because there's more money chasing the same amount of stuff). That means that everybody who's not the government is getting less of the stuff. Now, that can be fine, if the government is doing things with the stuff that are going to pay society back down the road. If not, though, the government is just using up more stuff, leaving everybody else with less stuff, and causing inflation into the bargain. So the question is: What made up that debt of 100% of GDP? Was it good investments that are going to pay the UK back? Or was it just waste?

s1artibartfast 2y ago

What do you think a "budget" is? It is simply a spending plan developed by humans. Of course they exist. There can be real world consequences for having a bad budget. What exactly are you trying to say?